Which EU reform is best for business?
EUROPE needs reforming now to make it more competitive, and in doing so Britain will be more enthusiastic about its membership. We have spent time consulting businesses about what the UK needs to push for in Europe, and have travelled to many European capitals, finding out what Europe needs, and where multilateral negotiation is possible. The message is clear: yes to reform, no to a special deal for Britain.
“Germany could support these plans”, David McAlister, leader of the German Christian Democrats in Lower Saxony and close confidant of Angela Merkel told the audience at the recent launch of our manifesto. This underlines the fact that Germany sees the UK as a vital partner and an ally in wanting to see the market in services liberalised.
Our proposals have the backing of over 170 business leaders, from major global companies listed around the world to small and medium-sized enterprises (SMEs), all with the goal of a more competitive, efficient EU.
They agree that our reforms are credible, achievable and rooted in the belief that the EU is not working nearly as well as it should be. These are the five constructive things we can start doing now.
First, complete the single market in digital, telecoms, transport and energy. Many think this is a cliché of the European debate but, apart from completing ambitious trade agreements, it is the most promising area to create growth and jobs. The government estimates that UK GDP could be boosted by up to 7.1 per cent over 10 years.
Second, we must focus on free trade. Negotiations have just begun on a comprehensive EU-US free trade deal, with the ambitious hope of achieving agreement by the end of next year. If completed, this could add up to £10bn a year to Britain’s economy. This is an opportunity to set global standards, and the UK needs to be in the EU pushing a liberal agenda to make that happen. Outside the EU, the UK’s influence would be severely curtailed.
Third, we need to make life easier for SMEs. We propose that not one piece of legislation can be passed without a rigorous SME test, as well as new independent impact assessments that would be verified outside the European Commission.
Fourth, the City is a huge asset to Europe, and to Europe’s place in the world. Part of the solution to the euro crisis will be less reliance on banks and more use of capital markets. A recent victory on bank regulation meant that non-Eurozone countries would not be discriminated against in the provision of financial services in any currency within the EU.
Fifth, we need to streamline the EU. Powers should be in the hands of national governments unless there is a strong case for supranational decision-making. This is exactly the point that Mark Rutte, the Dutch Prime Minister, made recently when launching a subsidiarity review much like the UK’s Balance of Competences.
Our case is further strengthened by the fact that the ultimate solution to the euro crisis is greater competitiveness. Countries cannot devalue anymore, so they are being forced to liberalise markets, reform pension systems, privatise state enterprises, recapitalise their banks and look to balance their books. Britain is not perfect, but we do have some experience in these areas – both of our successes and wrong turns – we could usefully share.
Our next step is to take this message across the UK and across Europe, with plans for business delegations to The Hague and Berlin in the coming months. We know that European businesses want Europe to become more competitive. So we should be confident that constructive engagement will deliver the reforms British business wants, and be uncompromising in our ambition to achieve them.
Roland Rudd is chairman of Business for New Europe. www.bnegroup.org
- For the opposing argument from Matthew Elliot, click here: The terms of Britain’s membership of the EU are flawed and need to be addressed